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cusman said:

Blu-Ray was not a better format than HD-DVD

But it won anyway for a few simple reasons

1) The HD-DVD on X360 was an additional $200 add-on expense
2) The Blu-Ray on PS3 was included in every model and much cheaper than stand-alone Blu-Ray players
3) Content

Sony owns a significant portfolio of Hollywood movie studios
Sony made deals with others like Warner Bros and Paramount for timed exclusive Blu-Ray only for their HD movie library

So ultimately it was about Content

It is always about Content... and for Games Blu-Ray hasn't really been that useful because it is much slower than DVD so to allow the game to load/run fast anyway they put the same data on multiple parts of the same disk. It also makes developers stupid about optimizing and not using good compression techniques which again help the games load faster.

Case in point

The massive game world of Skyrim on X360 fits on a single DVD Disk or it fits on the much larger Blu-Ray disk but runs more poorly.

I do like that Blu-Rays are extremely resilient and scratch resistant.

I don't know where you get the idea that hd-dvd was better. Blu-ray has more storage and higher data transfer rates. It was however rushed into production since hd-dvd already came out, so the early blu-ray discs were stuck with single layer mpeg-2 video.
http://en.wikipedia.org/wiki/Comparison_of_high_definition_optical_disc_formats#Technical_details

The 2x blu-ray drive is about on par with the minimum read speed of the 12x dvd in the 360. It doesn't however have the luxury to put stuff that needs to be accessed fast on the outer rim since blu-ray has constant data transfer speed. Data on the outside of a dvd is read about twice as fast as on the inside. The constant data transfer rate is also the major factor why the ps3 needs so many installs. Seek times on blu-ray are slower since the spin speed of the disc needs to change when repositioning the head. CAV is much better suited for data. A 4x cav blu-ray drive will blow 12x dvd out of the water. That's what Sony should have put in the slim.

And sure the world of Skyrim might be big but it's also extremely repetitive.

I'm glad sony put a blu-ray drive in the ps3. Their player is so much better then the hd-dvd add-on. And it would have sucked if both formats had been going on for longer. At least this time the better format won.